Transcript No Slide Title

L3c
Audit and assurance
J. E. Spencer-Wood
Auditing and assurance
Lecture 3c
Auditing standards
An example - ISA 210 (April 2009)
Agreeing the Terms of Audit Engagements
(ISA (UK and Ireland) 210 - September 2009)
October 2009
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the
UNIVERSITY
of
GREENWICH
L3c
Audit and assurance
J. E. Spencer-Wood
ISA groupings
• 200-299
• General principles and responsibility
• 300-499
• Risk assessment and response to assessed risks
• 500-599
• Audit evidence
• 600-699
• Using work of others
• 700-799
• Audit conclusions and reporting
• 800-899
• Specialised areas
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the
UNIVERSITY
of
GREENWICH
L3c
Audit and assurance
J. E. Spencer-Wood
ISA 210 - Where does ISA 210 fit?
ISA’s
Groups
(Example - Group 200-299 ‘General principles and responsibility’)
Sub-groups
(Example - Group 210 ‘Agreeing the terms of audit engagements’)
Requirements
(Example – Agreement on audit engagement terms, paragraphs 9-12)
Supporting materials
(Example – Agreement on audit engagement terms, paragraphs A21-27)
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the
UNIVERSITY
of
GREENWICH
L3c
Audit and assurance
J. E. Spencer-Wood
ISA 210: Agreeing the Terms of Audit Engagements
‘Agreement on Audit Engagement Terms
9. The auditor shall agree the terms of the audit engagement with management or
those charged with governance, as appropriate. (Ref: Para. A21)
10. Subject to paragraph 11, the agreed terms of the audit engagement shall be
recorded in an audit engagement letter or other suitable form of written
agreement and shall include: (Ref: Para. A22-A25)
(a) The objective and scope of the audit of the financial statements;
(b) The responsibilities of the auditor;
(c) The responsibilities of management;
(d) Identification of the applicable financial reporting framework for the preparation of
the financial statements; and
(e) Reference to the expected form and content of any reports to be issued by the auditor
and a statement that there may be circumstances in which a report may differ from its
expected form and content.
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the
UNIVERSITY
of
GREENWICH
L3c
Audit and assurance
J. E. Spencer-Wood
ISA 210 - Terms of Audit Engagements (cont.)
•
•
11. If law or regulation prescribes in sufficient detail the terms of the audit
engagement referred to in paragraph 10, the auditor need not record them in a
written agreement, except for the fact that such law or regulation applies and
that management acknowledges and understands its responsibilities as set out
in paragraph 6(b). (Ref: Para. A22, A26-A27)
12. If law or regulation prescribes responsibilities of management similar to
those described in paragraph 6(b), the auditor may determine that the law or
regulation includes responsibilities that, in the auditor’s judgment, are
equivalent in effect to those set out in that paragraph. For such responsibilities
that are equivalent, the auditor may use the wording of the law or regulation to
describe them in the written agreement. For those responsibilities that are not
prescribed by law or regulation such that their effect is equivalent, the written
agreement shall use the description in paragraph 6(b). (Ref: Para. A26)’
ISA 210 IAASB, 2009
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the
UNIVERSITY
of
GREENWICH
L3c
Audit and assurance
J. E. Spencer-Wood
Homework
• Do the ‘Quick quiz’ and questions 2 and 3 on
pp33-34 of the set text
• Go to the IAASB website and find ISA 210
• http://web.ifac.org/download/2009_Auditing_Handbook_A009_ISA_210.
pdf
• Study the structure and contents of the standard
for tutorial discussion next week
• Handout questions 1 and 2
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the
UNIVERSITY
of
GREENWICH